[2025] KEBPRT 166 (KLR)

Planet Play (K) Limited v Karuna Holdings Limited (Tribunal Case 1315 of 2024) [2025] KEBPRT 166 (KLR) (3 March 2025) (Ruling)

Neutral citation: [2025] KEBPRT 166 (KLR)

Republic of Kenya

In the Business Premises Rent Tribunal

Tribunal Case 1315 of 2024

A Muma, Member

March 3, 2025

Between

Planet Play (K) Limited

Applicant

and

Karuna Holdings Limited

Respondent

Ruling

A. Parties and their Representatives 1. The Applicant, Planet Play(K) Limited, is the Tenant of the demised premises known as Arifa Complex situated on Land Reference No. 1160/30 Marula Lane Karen (the “suit property”)

2. The firm of Ombiro Tolbert & Company Advocates represent the Tenant in this matter.

3. The Respondent, Karuna Holdings Limited, (herein “the landlord”) is a registered proprietor and legal owner of the Arifa Complex Arifa Complex situated on Land Reference No. 1160/30 Marula Lane Karen.

4. The firm of Anthony Gikaria & Company Advocates represents the Landlord in this matter.

B. Background of the Dispute 5. The landlord served the tenant with a notice dated 29th October 2024 notifying them that the lease agreement dated 1st December 2022 for a period of 2 years was expiring on 30th November 2024. It stated that if the landlord does not hear from the tenant by 30th November 2024, the landlord will have no any other choice but to request the tenant render vacant possession of the subject premises.

6. Consequently, the tenant moved this Tribunal through a reference dated 29th November 2024under section 12(4) of CAP. 301, Laws of Kenya complaining that the landlord had served them with an illegal notice requiring that they vacate from the suit property by 30th November 2024.

7. The tenant also filed a motion evenly dated, seeking for a restraining order against the landlord from any interference with the tenancy pending hearing and determination of the suit. The application is supported by the tenant’s supporting affidavit of even date.

8. This Court issued interim orders dated 2nd December 2024 restraining the landlord from any interference with the tenancy pending the hearing and determination of this matter interpartes.

9. In response to the Tenant’s Reference and Application, the landlord filed a Replying Affidavit sworn on 10th December 2024.

C. Tenant’s Case 10. The Tenant claims that it entered into a lease agreement with the Landlord on 1st December 2022 for a period of 2 years.

11. It is the Tenant’s case that the notice of termination served upon it by the Landlord is defective and illegal and ought to be dismissed with costs as it falls short of the requirements for a notice of termination of a controlled tenancy under Cap 301.

D. Landlord’s Case 12. The landlord denies that the notice to vacate was illegal. They claim that the license has expired by effluxion of time and that the tenant is currently in illegal possession and occupation of the demised premises.

13. The matter was ordered to proceed by way of written submissions and both parties complied. I shall address the submissions together with issues for determination.

E. Issue for Determination 14. The following issues arise for determination in this case: -a.Whether the Parties are bound by the Lease Agreement dated 1st December 2022?b.Whether Notice to surrender vacant possession of the demised premises was duly issued?

F. Analysis and Determination 15. The jurisdiction of this tribunal to the current matter has not been challenged. I will consequently proceed to address the issues framed for determination hereabove.

a. Whether the Parties are bound by the Lease Agreement dated 1st December 2022 16. The current dispute arises from a Licence Agreement dated 1st December 2022 which is ideally has all features of a Lease including; exclusive possession, defined premises and defined term. Clause 1(iii) of the Agreement provides that the Agreement shall be for a period of 2 (two) years commencing on 1st December 2022 and terminating on 30th November 2024. Clause 8(ii) further provides that any party seeking to terminate the relationships must issue a 3 Months’ Notice.

17. My understanding in relation to the stated clauses is that the parties intended to terminate the tenancy relationship after effluxion of time, being 2 years as stated in the Agreement and must comply with Clause 8(ii) of the Agreement.

18. It is an established jurisprudence that a court of law cannot re-write a contract between parties. In the case of SK Macharia v Daima Bank (2008) eKLR, the court stated that “parties are bound by the terms of their contract, unless coercion, fraud or undue influence are pleaded and proved.” See also Centurion Engineers & Builders Limited v Kenya Bureau of Standards (Civil Appeal E398 of 2021) [2023] KECA 1289 (KLR) (27 October 2023) (Judgment).

19. It is important to note that in the present suit, coercion, fraud or undue influence has not been pleaded by the parties. The parties are therefore bound by their Licence Agreement dated 1st December 2022 including clause 1(iii) and Clause 8(ii) which stipulated the duration of the Licence and the duration for issuing a termination notice.

20. The Licence Agreement does not offend any provision of CAP 301 in any way, including section 4 of the Act. It is therefore, my honest finding that Licence was intended to terminate by 30th November 2024 which has expired. The terms of this License cannot therefore be biding upon the parties.

b. Whether Notice to surrender back vacant possession of the demised premises was duly issued. 21. Having established that the Licence Agreement is binding upon the parties, I now turn to address whether the Notice issued to end the relationship, as per the Agreement was duly issued.

22. Section 4(2) of the Act provides that:-“a landlord who wishes to terminate a controlled tenancy, or to alter, to the detriment of the Tenant, any term or condition in, or right or service enjoyed by the tenant, under such a tenancy, shall give notice in that behalf to the tenant in the prescribed form”.

23. It continues under section 4(4) to provide that:-“No tenancy notice shall take effect until such date, not being less than two months after the receipt thereof by the receiving party.”

24. In my view, the minimum notice period for terminating a tenancy under the Act MUST be at least two months, regardless of the tenancy duration specified in the agreement between the parties. The Act does not exempt tenancies with a fixed duration from this requirement. This provision ensures that tenants have sufficient time to make necessary arrangements before vacating or surrendering possession of the premises.

25. A party seeking to terminate a tenancy must adhere to the provisions of Section 4(4) of the Act when issuing a notice. The binding nature of Clause 3 of the License Agreement does not override this statutory requirement. Consequently, the landlord’s notice to vacate, issued on 29th October 2024 and intended to terminate the tenancy by 30th November 2024, fails to meet the requirements of Section 4(4) in both form and substance and is therefore defective and improperly issued.

A. Orders 26. In the upshot, the tenant’s Reference and Application dated 29th November 2024 are allowed in the following terms:i.The landlord to issue a fresh termination notice in compliance with section 4(4) in in the prescribed form as required under section 4(2) of the Act read together with Clause 8(ii) of the License Agreement; andii.Each party to bear their own costs.

HON A. MUMA - MEMBERBUSINESS PREMISES RENT TRIBUNALRULING DATED, DELIVERED AND SIGNED AT NAIROBI ON THIS 3RD DAY OF MARCH 2025In the presence of Ombiro for the Tenant and Gikaria for Landlord.HON A. MUMA - MEMBERBUSINESS PREMISES RENT TRIBUNAL